Diamondhead Casino Corporation Enters Into Letter of Intent

LARGO, Fla., Dec. 15, 2010 /PRNewswire/ -- Diamondhead Casino Corporation (OTC Bulletin Board: DHCC) (the "Company") announced that on December 10, 2010, it had entered into a Letter of Intent "LOI") with Phoenix Gaming and Entertainment, LLC.  

DHCC owns, through its wholly-owned subsidiary, Mississippi Gaming Corporation, approximately 404 acres of land in Diamondhead, Mississippi.  The property is lien-free and debt-free and is zoned for a casino. The property fronts Interstate 10 for approximately two miles and the Bay of St. Louis for approximately two miles.

Under the LOI, Phoenix proposes to purchase 25 acres of land for $1 million per acre to be used, in part, for the construction of a casino. DHCC has agreed to give Phoenix an additional 15 acres of land to be used for the construction of roadways and right-of-way requirements, greenery, buffering, on-site mitigation and/or the footprint for a possible parking garage. Under the LOI, DHCC retains the right to construct its own casino on the remaining land, but  Phoenix gets the right of first refusal with respect to any additional, future gaming development by other parties on the property.  The LOI is a non-binding agreement and unless and until DHCC and Phoenix sign a Definitive Agreement, the relationship between the parties will be non-exclusive and DHCC shall be free to continue discussions with other interested parties. Unless extended by the parties, the LOI will automatically terminate if no Definitive Agreement is in place by January 31, 2011.

Zoning Extension

The Diamondhead property, which is located entirely within Hancock County, is zoned as a Special Use District-Waterfront Gaming District, which permits the development of a casino resort. The Company is pleased to report that on November 18, 2010, the Hancock County Planning Commission voted to approve the Special Use zoning through December 31, 2011. On December 6, 2010, the Hancock County Board of Supervisors ratified the decision of the Planning Commission.

Director Resignation

Mr. Steve Norton, who has been a Director of the Company since 2002, announced that he was resigning from the Board of Directors of the Company. It was felt that Mr. Norton, who has been active in the gaming industry for many years, had a personal and business conflict of interest. Mr. Norton has been a valuable asset to the Company and his presence will be missed.

Cautionary Statement Regarding Forward-Looking Statements

The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements so long as those statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those projected in such statements.

All statements, trend analysis and other information contained in this release relative to  performance, trends in operations or financial results, plans, expectations, estimates and beliefs, as well as other statements including words such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "will," "could" and other similar expressions, constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995. In connection with certain forward-looking statements contained in this release and those that may be made in the future, there are various factors that could cause actual results to differ materially from those set forth in any such forward-looking statements. The forward-looking statements contained in this release were prepared by management and are qualified by, and subject to, permitting, significant business, economic, financial, competitive, environmental, regulatory and other uncertainties and contingencies, all of which are difficult or impossible to predict and many of which are beyond the control of the Company.  Accordingly, there can be no assurance that the forward-looking statements contained in this release will be realized. The forward-looking statements in this release reflect the opinion of the management as of the date of this release. Readers are hereby advised that developments subsequent to this release are likely to cause these statements to become outdated with the passage of time or other factors beyond the control of the Company.  The Company does not intend, however, to update the guidance provided herein prior to its next release or unless otherwise required to do so. Readers of this release should consider these facts in evaluating the information contained herein. In addition, the business and operations of the Company are subject to substantial risks, including but not limited to risks relating to liquidity and cash flows, which increase the uncertainty inherent in the forward-looking statements contained in this release. The inclusion of the forward-looking statements contained in this release should not be regarded as a representation that the forward-looking statements contained in the release will be achieved. In light of the foregoing, readers of this release are cautioned not to place undue reliance on the forward-looking statements contained herein.

Additional information concerning the potential risk factors that could affect the Company's future performance are described from time to time in the Company's periodic reports filed with the SEC, including, but not limited to, its Annual Report on Form 10-K, Amendments thereto, and Quarterly Reports on Form 10-Q.

SOURCE Diamondhead Casino Corporation